Google might be preparing to create and launch a whole family of consumer devices that would compete against Apple products. That obviously would raise the risk of channel conflict with Android licensees, but some amount of potential channel conflict might now be a risk Google believes it must take, given the full range of markets Google now operates in.
Nor are such decisions unusual. Cisco decided it did not want to purchase Skype, though it had the opportunity, because of the perceived risk of alienating its service provider customers. Microsoft, which also works closely with mobile service providers, made a different decision, and purchased Skype.
Now Cisco finds itself needing to integrate Skype video with the rest of the Cisco telepresence products. Needless to say, Cisco executives might be second guessing that earlier decision not to risk channel conflict. Metaswitch Networks confronted the same issue in the session border controller area.
Metaswitch Networks provides the software that powers many of the leading SBCs. But, faced with demand from many of its customers, Metaswitch decided to launch the Perimeta line of SBCs, which means it now competes, in principle and fact, with potential or current licensees.
The point is that channel conflict simply cannot always be avoided.
Depending on your perspective, Google’s formal hardware strategy is either a dangerous shift of strategy or only the logical extension of Google’s increased profile in the devices business.
Google’s Android operating system is a major global presence in smart phones and tablets, and Google also has built and sold a “hero” Nexus device to illustrate what it believes can be done in the smart phone area using Android. Google has purchased Motorola Mobility, and so now is a supplier of mobile devices.
Google also provides support for a couple of firms building Chromebooks, meaning Google already is partly in the PC business. And Google already has cooperated with a few manufacturers on Google TVs.
Google recently announced it was going to build and market an in-home music entertainment system, as well.
So a formal “hardware strategy” wouldn’t be much of a stretch.
Google and Apple seem destined to compete on many fronts, a fact that has been clear for a few years, dating back to the days when Eric Schmidt, then Google CEO, was a member of Apple’s board of directors. Schmidt resigned in 2009.